Inflation is a measure of the rate of rising prices of goods and services in an economy. That's a pretty simple definition you can find in any Econ 101 textbook, but the challenge for investors in this environment is to figure out how we might profit from inflation or at least not get run over by it.
I do not know of a real good way to invest in rising wages or rents so I thought about raw materials or commodities, if you will. With some commodities' high prices today that can translate into more supply in a relatively short time. Farmers can switch from one crop to another, for example. However, I wanted to look at materials that have a long lead time between higher prices and more supply -- metals, energy and timber. The lead time from finding a new area to mine or drill to actual production can be years in the future and this is where, I believe, the greatest inflation pressures will be seen.
Along these lines, I already recommended the Invesco DB Commodity Index Tracking Fund (DBC) on Jan. 3 as my top pick for 2022 and beyond. However, with Covid still on our minds every day and night and in keeping with my materials/inflation theme, I am also introducing my 'BOOSTER' portfolio of seven stocks whose charts suggest they could climb in 2022 and beyond: